Strong demand puts Ocado on course for maiden annual profit

LONDON, March 12 (Reuters) - British online grocer Ocado
posted an 18 percent rise in first quarter retail
sales, putting the firm on track to make its first annual pretax
profit in 2014.

Ocado, whose range includes products supplied by upmarket
grocer Waitrose, said on Wednesday its gross retail
sales increased to 218.8 million pounds ($364 million) in the 12
weeks to Feb. 23.

That compares to an increase of 20.1 percent in the 16 weeks
to Dec. 1.

Average orders per week rose 18.4 percent to 155,152, though
average order size dipped 0.4 percent to 117.53 pounds.

Ocado's first quarter gross group sales increased 22.6
percent to 227.5 million pounds.

Shares in Ocado have risen over four-fold over the last 12
months mainly on the back of a 200 million pounds deal with
Morrisons, Britain's No. 4 supermarket, to provide its
online grocery operation, and on hopes it could do similar deals
overseas.

Ocado said the Morrisons.com ramp up was "progressing well",
having launched on Jan. 10.

"While we are encouraged by our current trading, the retail
environment remains both challenging and competitive, and we
expect to continue growing in line with, or slightly ahead of,
the market," said Chief Executive Tim Steiner.

Last month Ocado posted a wider loss for its 2012-13
financial year, but said it was well positioned for 2013-14 - a
year when analysts expect it to make a pretax profit for the
first time.

The stock closed Tuesday at 572 pence, valuing the business
at 3.34 billion pounds.